Suppose the Government Would Like to Reduce Smoking Rates Among

question 48

Multiple Choice

Suppose the government would like to reduce smoking rates among teenagers. Which of the following policies is designed to achieve this goal by changing incentives?

• A) The government requires all high school students to take a health class, and the harmful effects of cigarette smoke will be a required component of the curriculum.
• B) The government asks all high schools to post "Thank you for not smoking" signs around the school grounds.
• C) The government raises the legal age for purchasing cigarettes to 20.
• D) The government raises the tax on cigarettes.

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Definitions:

Individual Income

The total amount of money earned by a person from all sources before taxes.

Tax Competition

It refers to the phenomenon where countries or jurisdictions compete against each other to attract business through lower tax rates or more favorable tax regimes.

Federal Taxes

Federal taxes are financial charges imposed by a government on individuals, corporations, and other entities' income, property, or transactions to fund public services and obligations.

Regressive

A term referring to a tax system where the tax rate decreases as the amount subject to taxation increases, often disproportionately affecting lower-income individuals.